The resolution of territorial development issues is the responsibility of local authorities. The level of this power solves the current problems of citizens living on its territory, understands their pressing problems. Civil society, as a rule, evaluates the political successes or failures of the state as a whole based on the results of the work of local authorities. Strengthening the financial base of the regions by analyzing tax and non-tax revenues of the local budget is an important task of local governments.
Basic wording
The preparation, coordination, approval and use of the budgets of municipalities is carried out by local executive bodies.
Local budget revenues are recognized as financial resources transferred to the management of local authorities based on the current legislation of the country.
The procedure for the formation of local budgets is enshrined in the Budget Code of the Russian Federation. Tax revenues are the foundation of the budgets of the country's subjects.
Drawing up and actual execution of local budgets are based on the following principles:
- Isolation
- Financial support from the state.
- Openness of compiling and spending financial resources.
What is not tax revenue of local budgets, and what is, we will write below.
Sources of funds from municipal budgets
The receipt of own tax revenues of the local budget includes:
- Local fiscal fees.
- Deductions from taxes and fees at the regional and federal level.
- National tax.
The compilation of tax revenues of the local budget is formed by deductions according to the standards in local budgets. They are enshrined in articles 61, 611, 612 of the Budget Code of Russia.
There are, in addition to tax, and non-tax revenues of local budgets:
- Transfer of funds provided from local budgets of entities, other gratuitous receipts from the budgets of other entities.
- Income from leased assets of municipal property.
- An integral part of the financial result of unitary enterprises of municipal importance.
- Voluntary money transfers.
- Loans between structures at different levels.
Local fees, tax revenues at the regional and federal levels, from fiscal fees provided for by certain fiscal regimes, as well as non-tax payments in total amount to the income of the country's subjects. In other words, their own incomes are tax and non-tax payments transferred to the budgets of the constituent entities of our country.
Local fiscal payments
Taxes and fees at the local level are regulated by the executive bodies of local government in accordance with the legislation of the country. The share of tax revenues in local budgets is the main one. In accordance with paragraph four of Article twelve of the Tax Code of the Russian Federation, with the introduction of local fiscal tax, the legislative bodies of self-government at the local level spell out the key points of taxation:
- bids
- the procedure and periods for making payments;
- reporting forms;
- fiscal benefits.
Other important elements of fiscal taxation are established by tax legislation. The list of local fiscal payments is currently as follows:
- Fiscal fee on income of citizens.
- Land tax.
- Registration fee from entrepreneurs engaged in commercial activities.
- Fiscal fee for advertising.
Fiscal fee on real estate of individuals
In all territories with local government of our state, the payment of fiscal tax on property has been introduced. It relates to tax revenues of local budgets. Moreover, in each subject, the payment of the fiscal tax on real estate of individuals is introduced by a separate legislative act adopted by the representative authority of the subject.
The fiscal fee is listed for citizens who own residential facilities (houses, cottages, apartments, rooms and townhouses), garages that are owned by the citizens of the country. The size of the tax is regulated by the authorities of the subject of the country, responsible for the receipt of funds in local budgets from taxes and fees. The fiscal benefit from property tax is provided for:
- To the heroes of Russia and the Soviet Union.
- To participants of the Second World War.
- Disabled people of the first and second groups.
- To pensioners.
If a citizen who has the right to a fiscal benefit owns simultaneously several objects subject to fiscal taxation, then the benefit applies to one of them. The tax income of the local budget on the example of a fee on the property of a citizen is formed as follows. For example, a citizen who has retired has two apartments and a summer house, then he is entitled to a fiscal benefit for one of the two apartments and a summer house. Another residential property is fully taxed. A fiscal benefit cannot be obtained only in relation to:
- commercial real estate;
- construction in progress.
To receive benefits for the current year, you must write to the tax office about the selected object of preferential taxation before the first of November of the current year. A citizen has the legal right to change his choice once a year.
Tax revenues of local budgets are generated from the tax on property of citizens. The rules for calculating and paying fiscal fees on property of citizens are enshrined in chapter thirty-two of the Tax Code. The provisions of the chapter are the same for all subjects of the country, but at the same time, regional authorities can establish features within the framework of the law. Municipal authorities can approve their tax rates. The main thing is that this value does not go beyond the framework established by chapter thirty-two. The rates may be different depending on the given conditions. In addition, regional authorities are allowed to increase, but not reduce, the size of fiscal deductions specified in the law and introduce, but not reduce, benefits. These rights allow areas with local government to produce a small increase in tax revenues to local budgets. The sizes of fiscal rates and deductions can be clarified at the Federal Tax Service Inspectorate at the place of registration (residence). There is a flip side to this issue, the tax revenues of the local budget of Krasnodar in 2016, for example, were not met largely due to property deductions due to citizens living in this subject of the country.
Citizens who own immovable property pay property tax. Payers are also the owners of residential buildings located on garden plots and gardens. Revenues of local budgets are created at the expense of collection on property rather substantially.
The tax on property of citizens is calculated by employees of the tax inspectorate, who are responsible for budgeting through fiscal fees. They send a notification to all citizens requesting tax. In this case, inspectors may present the amount payable for no more than the last three calendar years preceding the period when a notice of payment of the fiscal fee was sent. If the inspectors include a tax for previous periods in the notification, the citizen has the right not to transfer funds to the state treasury. In life, it very often happens that information about acquired real estate does not reach the inspection staff in a timely manner. Notifications are not sent to citizens. The fiscal fee is not paid, and tax revenues of local budgets are significantly reduced due to this.
To resolve this problem three years ago, a new duty was introduced for all citizens of the country. Now, property owners themselves must submit data to the tax on objects of taxation with fiscal collection of property. This should be done only if for the entire period of ownership of the property the tax officers have not handed you a tax requirement. In addition to the message, you must submit documents proving your ownership of the property. This must be done before the end of the calendar year following the last period for filing tax reports. Starting from last year, citizens who have not fulfilled the obligation prescribed by law will be fined twenty percent of the unpaid fiscal fee in respect of real estate hidden from inspectors.
The base is calculated for each object individually. In the regions where the calculation of the fiscal fee based on the value according to the cadastre has been introduced, the tax base is the value of the property for the cadastre as of January 1. The cadastral value can be clarified in the multifunctional centers of the country. This information is provided to citizens free of charge. When calculating the amount of the fiscal fee, the cadastral value is reduced by the amount of the tax deduction.
How is the calculation of the collection base for property, which is the tax revenue of the local budget? Let's see the calculation. It will demonstrate how tax revenues of local budgets are formed, using an example. The cost of an immovable object, according to the cadastre, is four and a half million rubles, and the cost of a meter of real estate is ninety thousand rubles. Then the amount of the fiscal deduction will be equal to one million eight hundred thousand rubles, and the size of the base for tax - two million seven hundred. Regional authorities can increase fiscal deductions without any restrictions, thereby regulating tax sources of local budget revenues. If, as a result, the size of the property deduction turns out to be larger than the value of the real estate in the cadastre, the tax base will become zero.
Land tax
Today, land tax (plots) is fixed by fiscal legislation. The fiscal fee for land is paid by legal entities and individuals who own land plots by right:
- property;
- use on a permanent (perpetual) basis;
- inherited property.
The objects of fiscal taxation are land plots located within the boundaries of the municipal region where the fiscal fee is in effect. The following areas are not subject to fiscal taxation:
- located under the cultural objects of the peoples of our country;
- data for the special needs of the defense, security and customs structures of our state;
- within the fixed borders of the forest and water resources of our country.
Exempt from fiscal tax:
- enterprises of the criminal, executive structure of the Ministry of Justice of the country;
- organizations engaged in public roads at the state level;
- associations of people according to religious beliefs;
- organizations for the disabled of our country;
- organization of national crafts of our state;
- citizens assigned to the indigenous inhabitants of certain territories of the state.
The base for fiscal taxation is defined as the value of the cadastre of land in accordance with state law. The base for fiscal taxation is reduced by an amount not subject to taxation in the amount of ten thousand rubles per payer of a fee in the territory of one territory with local administration:
- Heroes of the USSR and Russia;
- bearers of the Order of Glory;
- people limited in the performance of professional activities on disability;
- invalids and veterans of the Second World War.
Fiscal fees rates are set by administrative documents of the executive bodies of the municipalities and cannot be higher than the numbers indicated in them:
- three tenths of a percent in relation to land plots assigned to agricultural territories or to plots in areas of use for the national economy in settlements and used for the production of crops; occupied by housing and utility infrastructure facilities; provided for the subsidiary plots of citizens, gardening, gardening or animal husbandry;
- one and a half percent in relation to other plots of land.
Entrance fee of entrepreneurs
Payers are citizens who wish to engage in private enterprise, not prohibited by the legislative acts of our country, without creating a legal entity, for their official registration as business owners. These payments are included in the income of local budgets from taxes and fees.
Regional authorities of the constituent entities of the country establish:
- maximum fiscal fee rate;
- list of payers entitled to fiscal collection benefits.
A tax on local budget revenues also applies. Moreover, the maximum size of his bet should not be higher than the minimum wage established by law. The amount of the fee for some payers within the established size of the rate is determined by the appropriate administration of the subject when considering an application for registration of a citizen as an entrepreneur. The amount of the fee, which is included in the tax revenues of local budgets according to the Budget Code, is credited to the appropriate budget at the place where the entrepreneur is registered.
The official registration of a citizen who wishes to engage in commercial activities is carried out by the appropriate administration of the subject at the place of permanent registration of this individual. For registration, the future entrepreneur submits an appropriate sample application. Registration must be done no later than within fifteen days from the date the citizen submitted the document. A citizen is issued a certificate of registration as the owner of the business for the period written in the application after the submission of a payment order on the transfer of funds to the collection. Paid registration fee is not refundable. It relates to tax revenues of local budgets. A citizen may not be registered if he wants to engage in activities not prescribed by law.
Advertising Tax
Tax revenue from advertising makes a significant contribution among local taxes to local budget revenues. With such input data, it turns out that if fiscal taxation in this area were limited, a substantial amount of funds would pass by the treasury of the country's subjects. This tax in the revenues of local budgets is a significant share. About one tenth of the budget. It is impossible to forget that local budget revenues are local taxes. After all, forgetting about it means reducing payments to public sector employees and retirees.
Quite often there are situations in which companies are forced to pay advertising tax, which is part of the tax revenues of local budgets, but not as a direct fiscal fee for the promotion of goods and services, but as a different fee (for example, for profit) according to the legislation of our country or due to falling advertising activities of the company under the laws of other countries. The tax rate is five percent. This provides a regular, ongoing profit for local budgets.
There are several methods to calculate advertising tax. The choice of one of them depends on who carries out the advertising work:
- If the advertising campaign of the enterprise is taken by a specialized company, then the fiscal fee is calculated from the costs of this campaign. The local tax is transferred to local budget revenues.
- If the company carries out the costs of promoting a product or service on its own, then the costs of materials, depreciation of equipment and tools, the wages of the workers involved in the process, as well as all indirect costs are summed up, and information about five percent of the spent is transferred to the tax office total costs.
Payment of fiscal taxes for advertising in local budget revenues is made at the end of the reporting period. It is worth remembering that this should be no later than the twentieth day of the calendar month following the reporting period.
The document on advertising tax, which is one of the varieties of local taxes on budget revenues, is compiled and approved by each entity independently, however, there are two main federal legislative documents concerning it, which the subject’s law should not contradict: the Law of the Russian Federation “On Advertising” and the Tax Code of the Russian Federation.
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Everything described concerns not only the tax revenues of the local budgets of the Russian Federation regarding large cities, which include the capital of our country and other cities, but also the provinces.
Non-tax revenues
Everything that is not tax revenue of local budgets is considered non-tax revenue. According to article forty-one of the RF Civil Code, these include:
- Cash receipts for the use of property owned by municipalities after payment of taxes and fees in accordance with applicable fiscal legislation.
- Cash receipts from commercial services provided by public sector institutions managed by local governments after taxes and fees approved by the current fiscal legislation.
- Funds received as a result of causing property damage to municipalities, and other financial means of forced withdrawal.
- Revenues in the form of cash assistance transferred from budgets of other levels of the state budget system, with the exception of loans and borrowings.
- Other non-tax revenues. Such financial revenues of local budgets are transferred at the expense of part of the result of the financial work of municipal unitary enterprises, remaining after taxes and other obligatory payments to the budget. The size of that part of the profit received in the revenues of the local budget is regulated by legislative acts of local self-government. Non-tax revenues of local budgets are made up of part of the financial result of municipal unitary enterprises remaining after tax. Their size is regulated by the legislative documents of local governments.
The main types of non-tax revenues of local budgets are indicated in article seven of the legislative document on the financial dogmas of local self-government. In accordance with this article, the following are included in own revenues of local budgets:
- Financial proceeds from the privatization and sale of any property of territories with local government.
- At least ten percent of revenues from the privatization of property of a state located in the territory of municipalities, carried out in accordance with the state-level privatization program.
- Financial proceeds from the lease of municipal property, including the rental of non-residential real estate, land. The budgets of municipal districts receive funds from state-owned land plots located in inter-settlement territories and intended for any construction purposes.
- Financial proceeds from cash lotteries at the local level.
- Cash compensation to be paid to local budgets. A contribution for negative impact on the environment that surrounds us is subject to forty percent to the budgets of municipal districts and the budgets of urban districts.
Transfers and subsidies
In connection with noticeably tangible adjustments to the structure and status of taxes, a decrease in their number, redistribution of cash flows through transfers, subventions and subsidies is of great importance in generating budget revenues at all levels.
Inter-budget transfers from the budgets of the country's subjects are transferred to local budgets in the following form:
- financial assistance to equalize the material capabilities of the municipalities of settlements in solving the problems of local importance of territories;
- financial assistance for material support of municipal districts to equalize the monetary security of urban districts;
- subsidies for shared monetary incentives for developing investment programs for the development of municipal infrastructure for civil society;
- subsidies for the purpose of material support for the performance by local authorities of certain powers of the state level.
Local authorities from the budget of a subject of the country can be granted loans up to a year in the manner and on special conditions established by the laws of the subjects of our country.
Translations from local budgets are also provided in the form of:
- Material assistance from the levels of municipal districts to settlement levels for the purpose of special, in relation to subsidies from the regional level fund, financial support for settlements, equalization of material levels, local self-government of settlements for the performance of their functions on local level management.
- Financial transfers to the budget of a country's subject of subventions from the budgets of municipal settlements or regions in which in the reporting year the estimated tax revenues of local budgets (excluding tax revenues in the form of deductions according to standards) exceeded the threshold legalized for the country's subject.
- Money transfers to the budget of the district at the municipal level of subventions for solving problems of local significance of an intersubjective nature.
Summary
To solve the problems of generating tax revenues of local budgets, it is necessary to revise the process of calculating and transferring the fiscal fees required to be paid in connection with the use of special tax regimes, and to increase the efficiency of collecting their payments to the state treasury.